Three Ways To Reduce Over Servicing

No one ever said running an agency is easy. There’s tremendous competition, ever-changing client needs, and a host of differing expectations from employees, management, and customers. Especially now that “PR” has expanded to include everything from digital content to strategy to SEO. The industry is growing as fast as it’s changing, but there are old habits that remain. Agencies continue to over service their clients and perform out-of-scope work. With employees billing hundreds of dollars an hour, it’s clear that the costs of over serving quickly add up and have a significant negative impact on the bottom line.

It’s critical for the entire team — management, HR, finance, and account execs — to have real-time project visibility. Managers need dashboards and reports that highlight long-term over servicing patterns and trends, and predictive analytics that alert them when accounts are likely to become over serviced. Similarly, employees need to see in real time how many hours or dollars they have left to commit to any project. By surfacing these metrics, it becomes much easier to identify — and stop — over servicing before it becomes an issue.

Measure Employee Utilization

Between a busy schedule, lack of proper technology, and a want to perform good work for clients, account executives may not even realize they are over servicing their customers. That’s why it is so important to measure employee utilization (billable hours worked vs. hours planned). It allows agencies to pinpoint exactly where there are operational deficiencies and room for improvement.

Top-performing agencies understand which employees are able to take on additional work. They assess who is under or over performing, and are able to quickly identify who is spending too much time on non-billable projects. They master the ins and outs of employee utilization.

But employee utilization is more than just a simple composite number. It can be ranked by customer, project, task, role, or even individual employee. This type of data — month over month or year over year — empowers executives to make strategic decisions about what kind of work to take on in the future, and how to best structure their team for operational excellence and financial health.

Create Realistic Benchmarks

How long does it take to write a press release? Or to coach an executive for a media campaign? What about rebranding a product or company? These aren’t simple questions to answer.

So here’s some good news: It is easy to get started and begin benchmarking process. Virtually every agency tracks employee time. And this time can (and frankly, should) be bucketed by type of work or activity. Through Excel, Google Apps, or almost any time tracking technology, reports can be run that breakdown the amount of time — and associated cost — of key activities.

Once management gains an understanding of how long employees are spending on specific projects, the team can assess whether or not these numbers are aligned with business objectives, communicate the results and any issues or discrepancies with the larger team, and begin to work to improve upon these metrics.

Accurate benchmarking is key to reducing over servicing. When combined with real-time visibility into projects and a deep understanding of employee utilization, agencies are able to maximize billable hours and create a culture of operational excellence.